Task force presents 18 recommendations to stabilize Minnesotaaffordable housing; calls for paired service funding and insurance study

A legislative task force charged with studying long-term sustainability of affordable housing presented an 18-point report to the Senate Housing and Homelessness Prevention Committee, urging state partners to pair service funding with capital, update underwriting and allocation rules, and examine rising insurance costs that threaten providers.

The report, staffed by Legislative Coordinating Commission research analyst Evelyn Weiner, lays out recommendations to evaluate permanent supportive and deeply affordable housing models, revise Qualified Allocation Plan (QAP) scoring for low-income housing tax credits, and create a policy framework for preserving regulated affordable housing as distinct from new construction. Weiner said the task forceduties were set by state statute and included evaluating financing, administrative tools, asset management practices and the potential loss of federally rent-assisted units.

Why it matters: witnesses and providers told the committee that rising operating costs, insurance increases and insufficient service funding are pushing affordable properties toward loss, closure or foreclosure. Several nonprofit operators described closures and large portfolio losses that, they said, put thousands of units at risk.

Center City Housing executive director Nancy Cashman, a task force member and Greater Minnesota provider, told the committee the sector is "at risk of losing very needed affordable and supportive housing across the state" and urged the state to preserve funding streams. "We cannot afford to lose any housing, especially affordable and deeply affordable housing," she said.

Private and nonprofit operators who testified described mounting financial pressure. Joe Abraham of the Minnesota Multi Housing Association, speaking also as a private operator, urged a statewide public-private strategy and warned that added regulatory costs can further deter investment. "If this State is committed to developing, preserving affordable housing, we have to form a public private partnership," Abraham said.

Project for Pride in Living chief operating officer Scott Cortes told the committee the sectormath has shifted since the pandemic, with an example of rapidly rising insurance costs. "Our insurance premiums ... have gone up 300%," Cortes said, adding that his organization experienced multi-million-dollar losses in 2023 and 2024 and that the recently released distressed property data report corroborates those trends.

Key recommendations summarized by LCC staff include: - Directing the legislature to partner with Minnesota Housing, providers, tenant groups and others to evaluate permanent supportive and deeply affordable housing models, and to research changes to QAP scoring to increase operational flexibility. - Asking Minnesota Housing and local jurisdictions to amend QAPs and consider changes after evaluations of 100% supportive housing models. - Instructing Minnesota Housing to develop a preservation policy framework for regulated affordable housing separate from new construction strategies. - Directing the Department of Commerce and Minnesota Housing Finance Agency to collect data on insurance market impacts for affordable housing providers and to report findings to relevant House and Senate committees. - Encouraging pairing of service funding with capital funding for permanent supportive housing units and aligning eligibility and documentation requirements between Minnesota Housing and DHS to enable lower-barrier strategies for formerly homeless households. - Recommending underwriting revisions, target time goals to close deals faster, and transparency among funding partners on underwriting and reserves.

Committee members and task force appointees emphasized that the report is a starting point, not a final solution. Representative and Senator co-chairs framed the recommendations as implementable steps that will inspire bills in the coming legislative session, while acknowledging additional work and fiscal constraints remain. Weiner and witnesses repeatedly stressed the need for follow-up legislation and funding.

No formal votes were taken at the hearing; committee members asked questions and expressed support for prompt legislative follow-up. The task force report and the distressed property data analysis will inform bills and further committee work in the legislative session.

Provenance (transcript excerpts): "And homelessness prevention to order. Today we will look at the results of the hard and important service work completed by members of the task force on long term sustainability of affordable housing..." (transcript block starting at 4.96 seconds).

"...I support each of the 18 recommendations and encourage their timely implementation." (testimony from Scott Cortes; near the end of the task force presentation, transcript block ending ~2180 seconds).

Ending: Committee leaders said they expect bills inspired by the task forcerecommendations to be introduced during the term and flagged the need for continued stakeholder engagement and potential funding decisions as the legislature considers implementation.